Ma sets example with succession plan

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Jack Ma, founder and chairman of Chinese e-commerce giant Alibaba Group, at a plenary session on e-commerce during the 48th annual meeting of the World Economic Forum in Davos, Switzerland, on 24 January 2018Credit:
Xinhua

25 September 2018 • 1:30pm

The Alibaba founder, who is stepping down from the company chairmanship, has gone against a regional norm by anointing Daniel Zhang Yong to follow him

The decision by Alibaba founder Jack Ma to step down from the company chairmanship of the tech giant next year is an important moment. Mr Ma, known as Ma Yun in China, is as closely associated with Alibaba as Bill Gates is with Microsoft or Steve Jobs with Apple.

Mr Ma established Alibaba as an e-commerce platform with $60,000 (£45,000) in 1999. In less than 20 years he has turned it into a $420bn behemoth that has more than 86,000 employees working in sectors ranging from online shopping to artificial intelligence and movie production. He is currently China’s third-richest person, with a net worth estimated at more than $36bn.

Like other entrepreneurs, Mr Ma’s initial period was full of disappointments, rejections and challenges. Born in Hangzhou, in the eastern Chinese province of Zhejiang, in 1964, he learnt English by offering free tours of the city to international tourists in exchange for an opportunity to speak English with them.

Later, after graduating with a major in English, he applied for 30 different jobs and got rejected by all of them. His internet journey began when he first went online while on a trip to the US in 1995. Four years later Alibaba was born, and now 20 years later he is stepping down.

Mr Zhang has been credited for creating Singles Day, an Alibaba shopping event that recorded one-day transactions worth more than $25bn last year

But this is a well-thought-out decision. Mr Ma stopped handling day-to-day operations in 2013 after he left the post of chief executive to concentrate more on charity work. He has been looking for a worthy successor capable of steering the company into the new era for the past decade. With the announcement of chief executive Daniel Zhang Yong as the next chairman, the search is over.

While history is replete with stories of successions going wrong, businesses breaking up and even public spats between founders and successors, all these possibilities look unlikely in Alibaba’s case.

First, Jack Ma is 54. He celebrated his birthday on 10 September – the same day he made his decision public — and can always take charge again if there is a need. Second, he spent 10 years with senior executives preparing the next generation for the role. Third, Mr Zhang is as steeped in the Alibaba culture as any other employee. He has been working with the company for more than a decade and has huge experience, including as head of Taobao and Tmall.

Mr Zhang has been credited for creating Singles Day, an Alibaba shopping event that recorded one-day transactions worth more than $25bn last year. He is the brain behind the company’s transition from PC to mobile, and Alibaba’s move to combine offline and online business. He said at a conference in Cape Town, South Africa, last year that Alibaba plans to double its annual transaction volume to more than $1000bn by 2020, and create 100 million jobs and serve 2 billion customers by 2036.

Now he intends to devote his energy to teaching, raising awareness about environmental causes and philanthropy through his Jack Ma Foundation

Of course, there will be some bumps in the road, but nothing the management should not be able to handle. But to keep operations running smoothly, Mr Ma will have to give Mr Zhang a free hand, and accept the two might not see eye to eye on everything and that Mr Zhang is now responsible.

What should make this process easier is that Mr Ma, who will stay on as a board member of Alibaba until the annual general meeting of shareholders in 2020, is likely to spend more time on his first love – teaching.

Today Jack Ma is known as a tech tycoon, but long before he dipped his toes into the world of bits and bytes he was an English teacher. Now he intends to devote his energy to teaching, raising awareness about environmental causes and philanthropy through his Jack Ma Foundation.

His decision to hand over the reins is especially momentous in Asia, as most business heads in the region either do not plan for succession or drag their feet until ill health or even death intervenes. First Jack Ma led the way in revolutionising the online Chinese market – and now, by stepping down, he is setting an example for current and future founders.

The author is a journalist with more than 18 years’ experience in media. The article reflects the author’s opinion, and not necessarily the views of China Daily and chinadaily.com.cn.

This article was originally produced and published by China Daily. View the original article at www.chinadaily.con.cn